One Hardee's became a restaurant empire

A big bite gives Boddie-Noell 343 eateries, Cafe Carolina among them

ROCKY MOUNT -- The nation's top Hardee's franchisee is laying a new bet on the Thickburger.

Boddie-Noell Enterprises said Tuesday that it had bought 34 Hardee's restaurants from the chain's corporate parent, including many locations in the Triangle.

The restaurants bring Boddie-Noell's total number of Hardee's to 343 in four states. The additions are scattered throughout 21 North Carolina towns, including five in Rocky Mount, Boddie-Noell's home.

Though Boddie-Noell operates several restaurants, including the Cafe Carolina and Bakery and Texas Steakhouse & Saloon chains, the deal solidifies Hardee's as its flagship chain.

"As Hardee's goes, Boddie-Noell pretty much goes," said president and CEO Bill Boddie. "Most chains go through cycles. We've got momentum now."

Terms of the acquisition from Hardee's parent CKE Restaurants were not disclosed.

The deal helps CKE, which bought Hardee's 10 years ago, streamline its operations. The company is selling 200 restaurants to franchisees. For Boddie-Noell, the move positions it to grab a bigger bite of the $60 billion-a-year burger business.

"It propels us into the next phase of our company's expansion," Boddie said.

Tighter competition

There is no shortage of burger rivals. Local chains including Char-Grill and Snoopy's have recently announced expansions, and national chains including Red Robin and Five Guys are pushing into the area, too.

Hardee's, known for its monster burgers and fresh biscuits, has seen a bit of a rebound over the past decade as CKE has pumped money into advertising campaigns -- including some that poke fun at men who can't cook -- and new products.

The deal and its timing make sense for Boddie-Noell and CKE, said Darren Tristano, executive vice president for Chicago food industry research firm Technomic.

The increasingly competitive fast-food restaurant business sometimes requires companies to delegate the growth of a market to franchisees, he said.

"Normally when a company franchises a restaurant, they pick the best locations for themselves," Tristano said. "But with Hardee's, the franchisees are hungrier. They're looking at it like: This is how we make a living."

$949,000 in a year

According to regulatory filings CKE submitted with the Securities and Exchange Commission, franchised Hardee's had average sales of $949,000 last year, outperforming company-owned restaurants, which had $916,000.

Boddie-Noell is one of those successful franchisees, possibly because of the tight controls established in 1962, when Carleton Noell and his nephews, Mayo and Nick Boddie, became one of the first franchisees for Hardee's.

Mayo Boddie recalls that each night, they took an inventory of the cups, boxes and wrappers in the store. That kind of stringent inventory control has been passed on through the years. Even though he's president and CEO, Bill Boddie insists on paying when he eats at one of the company's restaurants.

"Sometimes they ask if I want the employee discount," he said. "I usually decline. But I tell you, what hurts is when they ask if I want the senior discount."

Building on history

From that one store in 1962, Boddie-Noell has grown into a chain of nearly 400 restaurants, including Hardee's, Cafe Carolina and Bakery, Texas Steakhouse & Saloon and Moe's Southwest Grill. It also has a resort and residential development arm.

With the 750 employees at the newly acquired Hardee's stores, Boddie-Noell will employ nearly 13,000 people.

Keeping all of those balls in the air is hard, especially with an acquisition of this size, Boddie said.